Israel and Palestinian militant group Hamas are on the verge of all out war, a number of organizations have reported, after the Islamist organization fired a rocket that killed three Israelis north of the Gaza Strip on Thursday, in response to the Jewish state killing the group's military leader.

In new developments on Thursday it has also been reported that Palestinian militants have launched rockets from Gaza at Israel's largest city, Tel Aviv. However, despite sirens being sounded and residents fleeing for cover, Israeli military have reported that neither of the two missiles launched had hit the city.

The missile attacks on Tel Aviv, Israel's commercial center, marks a further significant escalation of tensions in the region.

Bombings from the Israeli Defense Forces targeting sites in Gaza City have resulted in the deaths of 15 Palestinians, Reuters reported. However, according to Israeli police, Palestinian militants have fired more than 180 rockets at southern Israel in recent days.

Prime Minister Benjamin Netanyahu said that Israel will continue the military action against Hamas, and that he is prepared for "whatever action is necessary" to defend citizens from the Islamist group's attacks.

Hamas has said, however, that they are not backing down, and condemned the assassination of its military chief Ahmed Al-Jaabarion on Wednesday by Israeli Defense Force rockets.

"[It] is a serious crime, and they crossed the red line. It's time to declare war," Fawzi Barhoum, a Hamas spokesman, said.

Mourners buried Jabari's body following the attack, draping his corpse with the green flag of the Islamist militant movement, firing guns in the air and chanting "God is Great, the revenge is coming."

The killing of Jabari on Wednesday, which has sparked escalated engagement from the Palestinian side, stems from an age-old conflict in the Middle East, which is still trembling from two years of revolutions in several Arab countries, including the civil war currently raging in Syria.

Israeli authorities are determined to get a foothold on the Gaza situation, fearing that Palestine is gaining allies in Egypt, specifically among President Mohamed Morsi's administration. The Egyptian president has denounced the Israeli offensive and backed Hamas.

"The Israelis must realize that this aggression is unacceptable and would only lead to instability in the region and would negatively and greatly impact the security of the region," Morsi said, although he did not specify whether Egypt would in any way interfere on behalf of Hamas.

Although Morsi has pledged his commitment to Egypt's 1979 peace treaty with Israel, the fresh conflict is causing concern in the region. The Muslim Brotherhood, which was key in installing Morsi to power and has been called the "spiritual mentors" of Hamas, has called for a "Day of Rage" in Arab capitals on Friday in protest of Israel's attacks on Gaza.

Egypt withdrew its ambassador to Israel on Wednesday night after the attacks on Hamas, and urged a meeting with the U.N. Security Council to discuss the situation in Gaza. Egyptian Foreign Minister Mohamed Amr spoke with U.S. Secretary of State Hillary Clinton by phone, urging America, an ally of Israel, to intervene.

Ahmed Al-Jaabari, the Hamas military commander who died earlier this week, was one of seven fighters reportedly killed by Israeli attacks. According to the Palestinian Health Ministry, eight civilians were also killed by Israeli bombs this week, with the Palestinians claiming that among the dead was a woman pregnant with twins, and an 11-month-old boy and three infants. It was also claimed that another 130 people were wounded.

The death of the 11-month-old boy has been verified by BBC Middle East bureau chief Paul Danahar, who arrived in Gaza on Thursday. The 11-month-old baby was in fact the child of one of Danahar's BBC colleagues, Jihad Misharawi, who is a BBC Arabic journalist who lives in Gaza. Photos have been released showing Misharawi in despair, carrying the body of his 11-month-old son, Omar, through al-Shifa hospital in Gaza City.

According to the BBC, an Israeli round hit Misharawi's four-room home in Gaza on Wednesday, killing the 11-month-old.

Israel has claimed that it hit 156 targets in Gaza, 126 of them rocket launchers. Its defense system, named "Iron Dome," reportedly has shot down 81 rockets heading toward residential areas in the country, as the Hamas group retaliated.